The US Dollar was in focus yesterday as the impending CPI data was due to be released what we did see was that CPI came down unexpectedly and significantly in comparison to last month. CPI declined from last month as it came out as 0.5% in comparison to the previous month’s 0.9%, the result being that inflation stagnated as it is stable at 5.4%, still significantly higher than the target that they have in mind for the year.
The market action that we received post CPI was more of weakness than strength as the markets start pricing in what the Fed might be thinking of in their next meet as inflation stabilise and unemployment declines.
The Dow gained significantly from the improved CPI figures as well as unemployment figures as the Dow continues to make new highs, Nasdaq declined lower as there were no real significant gains made from the tech stocks. The Dax and FTSE broke through their recent highs as their upward momentum continues to push the European Indices higher especially with their increase in vaccination rates.
Precious metals rallied slightly higher off the back of some dollar weakness but still remain stable following Monday’s decline as we see Gold near its close of last week. Brent Crude recovered well as it closes out the day on $71.34.
Bitcoin and Ethereum continue to rally higher as Ethereum’s London Hard fork that happened on the 5th of August continue to cause some much-needed positivity for the alternative asset class.
As the European markets opened up the US Dollar is currently the strongest currency from all of the major currencies. The Pound, Australian Dollar, New Zealand Dollar and Swiss Franc are currently the weakest currencies.